Money wire warning as Fraud Awareness Week gets underway

Dispute resolution scheme Financial Service Complaints Limited is warning Kiwis to never wire money to people they don’t know and trust as Fraud Awareness Week kicks off this weekend.

Chief Executive Susan Taylor said that FSCL was working with the Ministry of Business, Innovation and Employment, the Financial Markets Authority, the Commerce Commission and other agencies to raise awareness of the dangers of scams and inform consumers and small business owners about how they can protect themselves.

A recent case investigated by FSCL highlights the need for consumers to be extra vigilant when asked to send funds by money transfer to someone they’ve never met.

“In this case, the complainant fell victim to a scam – one that’s been around for a while – where a prospective tenant is looking for a property to rent and gets scammed by the ‘owner’, usually someone overseas, who insists on money being wired to secure the deal,” said Ms Taylor.

“For our complainant, the advertisement looked legitimate, she started communicating with the ‘owner’ by email, then at the request of the ‘owner’ who claimed to be in Italy at the time, sent a deposit by money transfer in order for him to release the keys.”

The complainant never heard from the ‘owner’ again and because the money was picked up as cash at the other end, it was impossible to trace. The complainant took issue with the money transfer company for releasing the funds to a fraudster, however FSCL’s investigation found no fault and that the complainant – who was $1,600 out of pocket – had been a victim of a scam.

 

FSCL’s tips when sending funds via a money transfer service:

  • Never send money to people you don’t personally know and trust.
  • Never provide your personal information (eg date of birth) and banking information to people or businesses you don’t know.
  • If communicating by email, look for red flags like poor grammar, misspellings and excessive capitalisation.
  • Be cautious when dealing with people who say they currently live overseas or are out of New Zealand on business. Scammers tell victims this to explain why they can’t meet in person.
  • If you believe you may have been the victim of fraud, contact the money transfer service as soon as possible and the police.

 

Ms Taylor said that with online transactions and social media part of everyday life for most New Zealanders, scams were becoming more technologically sophisticated with fraudsters constantly designing new ways of scamming their victims.

“Despite the growing sophistication of scams, we still see people falling for the same old tricks. It is really important for New Zealanders to get up to speed with the type of scams that are doing the rounds and heed advice for staying safe.”

Find out more at www.scamwatch.govt.nz/faw

Media contact:

Susan Taylor, Chief Executive Officer FSCL

P: (04) 472 3725

Background

FSCL is an independent not-for-profit external dispute resolution scheme approved by the Minister for Consumer Affairs under the Financial Service Providers (Registration and Dispute Resolution) Act 2008. It was the first scheme to be approved and has been designed for and in consultation with the financial services industry on the principles of efficiency and effectiveness. It is governed by an independent Board with equal consumer and industry representatives, and an independent Chair.

 

FSCL provides dispute resolution services to participating financial service providers and their clients. The FSCL process focuses on resolving complaints through conciliation and assisted negotiation and is also able to make formal determinations which are binding on financial service providers. The FSCL process is free to consumers. For more information on FSCL visit www.fscl.org.nz

 

The other dispute resolution schemes in the financial services industry are the Banking Ombudsman, the Insurance and Savings Ombudsman and Financial Disputes Resolution. For more information about the financial services disputes resolution regime visit www.consumeraffairs.govt.nz/for-consumers/how-to-complain/financial-service-providers-disputes-resolution